Caremark claim over Citigroup ‘corporate traumas’ dismissed

By Mark S. Nelson, J.D.For the second time in a week Delaware courts have explained, in the words of former Chancellor Allen, the author of the Caremark decision, why the Caremark claim is “possibly the most difficult theory in corporation law upon which a plaintiff might hope to win a judgment.” Citigroup, Inc. shareholders had alleged that the bank’s officers and its board failed to conduct oversight with respect to anti-money laundering violations, fraud at a subsidiary bank, foreign exchange (FX) benchmark manipulation, and unlawful credit card practices. Days before the decision in the Citigroup case, the Delaware Supreme Court had reiterated the difficulties inherent in Caremark claims by rejecting a Caremark claim brought against Duke Energy for the company’s role in an environmental catastrophe, albeit over a dissent by Chief Justice Strine (Oklahoma Firefighters Pension & Retirement System v. Corbat, December 18, 2017, Glasscock,…

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